Completion of strategic review and agreed sale of US business

A strong outcome for all stakeholders

• Agreement to sell US business to Serco for purchase price of US$292m
• The transaction will create a stronger focused company with greater visibility
• £200 million of proceeds expected to be returned to shareholders following completion through additional share buybacks
• Strengthens balance sheet to enable increased investment in organic growth

Key transaction terms

Under the terms of the agreement, Serco will acquire the entire issued share capital of QinetiQ Inc. for a total cash consideration of $292 million, on a cash-free, debt-free basis and subject to customary completion adjustments.

Serco is an established provider to the US federal government. Its North America division generates annual revenue of approximately $2 billion and has capabilities and customer relationships complementary to those of QinetiQ Inc.

QinetiQ believes Serco provides scale to drive the future growth of the US business and is a good long-term owner for its customers and employees.

QinetiQ’s focus on core markets with attractive growth and returns

In May 2026, QinetiQ announced a review of its US business and options to deliver enhanced returns. Having assessed all relevant options, the Group has concluded that the agreed sale offers the best route to realise value for all stakeholders.

This sale positions QinetiQ as a stronger, focused, higher-quality company. With a strengthened balance sheet, QinetiQ will concentrate its resources on the UK, European NATO and key allied defence and security markets, where it has stronger positions and sees more attractive opportunities for growth and returns. The Group’s differentiated capabilities, underpinned by long-term customer relationships and contracts, are aligned with growing demand for accelerating warfighting readiness across these core markets.

Following completion, the Group expects to return £200m of the proceeds back to shareholders through uplifting the current FY28 and FY29 share buybacks by £100m p.a. In addition, the Group will increase investment in digital and AI technology, infrastructure and its people to deliver enhanced value for its customers and sustainable profitable growth for shareholders.

Further information on the disposal

QinetiQ Inc. generated revenue of $172 million and underlying operating profit of $13 million in the six months ended 30 September 2026. The Group’s FY27 guidance assumes revenue of $385m of revenue at c.7% margin for the US business. QinetiQ Inc. had a carrying value of £393 million in the QinetiQ balance sheet as at 31 March 2026; consequently, the Group has recognised a non-cash impairment charge of c.£175 million in its interim results.

Completion is subject to customary regulatory approvals, including US antitrust and foreign-investment clearances, together with the approval of appropriate arrangements relating to the business’s classified activities. Completion is currently expected in the first quarter of 2027.

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